For example, Roku, the big set-top box/TV app-publisher platform, declined to give guidance when it comes to where advertising will be in the third and fourth quarters. All this as Roku talked up big gains in “monetization of video” and other higher results from Roku TV direct advertising clients.
This isn’t especially breaking news -- many consumer product marketing companies are holding back on projecting, due to the up-and-down nature of where the virus may be headed.
Some of this reticence hit Roku’s stock hard on August 5, down around 7% on the day. Maybe it’s better to be safe than sorry -- especially with the fall/winter months coming and a possible resurgence -- along with the annual rising flu season cases.
Still, the good news is consumers will still be seeking more home-entertainment options on TV sets and other devices -- linear, on-demand and premium streaming.
The bad news is TV advertisers may be reluctant, or are unable, to spend marketing dollars, because consumers are, well, still at home, not out buying stuff (sans Amazon).
Estimates are Roku will pull in $566 million in video advertising dollars in 2020, according to MoffettNathanson Research -- going to $902 million in 2021 and $1.4 billion in 2022.
Typically, TV marketers look for signs of where the advertising marketplace is going from media-selling and media-buying executives' public musings, as well as general economic consumer data and other trends.
All this is occurring as the TV advertising upfront market inches along to an uncertain finish line, with many tossing around a $7 billion decline. This would yield a projected 30% fall -- to total $14 billion to $15 billion -- from its typical $21 billion to $22 billion annual perch.
In short, Roku's advertising prospects, as it concerns associated programming production delays at TV networks and other video publishers, are out of their control.
At the same time, it has full control over its own Roku Channel. No guidance in this more narrow area for the company.
Even with a ding on its stock last week, after its earnings release, many analysts are still positive on the company. Additionally, the stock is up 53% over a year ago and 15% higher since the start of the year. So why be greedy?